Purchase Order Funding for Apparel Manufacturers

Cash flow constraint is a common problem for apparel manufacturers, brands and wholesalers—becoming increasingly tight during the 60-90 days when goods are being produced and shipped. Purchase Order Financing and Accounts Receivable Factoring can help alleviate the cash flow concerns.

The manufacturing of apparel can be capital and time intensive, making it difficult to manage cash flow during periods of heavy production. With apparel companies shipping multiple seasons, it’s important to manage cash flow properly. Purchase Order Funding for Apparel Companies is a great solution to this problem as it allows businesses to obtain quick capital to produce their garments.

Purchase order funding gives apparel makers like you the ability to produce goods on time for your clients before an invoice is created. Working with an Accounts Receivable Factor on the back end, PO funding provides the upfront capital needed to fuel production.

Additionally, you can pay your manufacturers quickly without turning to high interest funding options. In many cases early payment to your supplier can even lead to an additional one to three-percent discount. Apparel companies can use PO funding as a tool to help manufacturers and brands deliver on time while avoiding cancellations.

Benefits of Purchase Order Funding

STAR Funding offers flexible PO funding options, helping manufacturers purchase the materials needed to successfully produce their apparel and deliver on schedule. Purchase Order Financingalso gives you a chance to complete a delivery without putting your company at risk of exhausting cash reserves. With a goodpurchase order financing partner you no longer have to worry about turning down larger orders.PO financing for apparel companies is also available for supply chains that are more complex, while Work-In-Process (WIP) Funding allows you to finance fabrics, trims and cut and sew as needed.

Working with STAR Funding

Founded in the heart of NYC’s Garment District by a former garment manufacturer in 1990, STAR Funding is the premier purchase order finance company for apparel manufacturers and importers. Located in central Manhattan, STAR has been providing financing to businesses in need of additional cash flow for more than 15 years. Understanding the ins and outs of the apparel business, the knowledgeable team will work with you to provide secure, cost effective PO Funding solutions that will position you for success.

PO Funding is not a business loan

PO Funding makes sure your suppliers get paid on time

PO Financing gives you the ability to accept and deliver larger orders

Finished Goods Financing

Funding a PO for finished goods is the most common type of purchase order financing. Less risky, it involves the purchase of goods for resale that don’t require any assembly or customization prior to reselling.

Finished Goods Financing is highly preferable to typical short-term loans, as it typically comes with a much more favorable interest rate and turnaround time. This is our most popular type of funding for our manufacturing clients.

Work in Process (WIP) Financing

PO Funding for WIP involves purchasing components or raw materials that must be assembled prior to selling to the end customer. Much more complex than finished goods financing, the risk is much higher. Additionally, the standard costs of work in process PO funding is greater.

However, work in process may not require 100% funding of raw materials, so the costs associated to the invoice may be significantly less than funding 100% of the finished product cost.

Apply for Financing with STAR Funding

If you’re looking to grow your business but lack working capital, STAR Funding can help. Providing you with flexible options, we offer multiple services—from financing finished goods to WIP—ensuring your needs are met in a timely and professional manner. As a privately held firm we are committed to providing same day answers and executing quickly to satisfy the needs of clients. Contact us today and learn how businesses backed by STAR are not just surviving—but thriving.